On August 19, 2025, the U.S. Commerce Division prolonged metal and aluminum tariffs by 50 % to 407 new product classes. Amongst these newly added classes are imported components for automotive exhaust methods and electrical metal important for electrical car parts.
These embody exhaust parts utilized in inner combustion fashions in addition to key EV steel inputs—issues like stator metal in EV motors and electrical metal for batteries. For a plant like Spartanburg, which depends on world sourcing for each conventional and electrified autos, these new duties will translate straight into value hikes.
BMW Margin Stress: Already Being Felt
BMW has already flagged the influence of tariffs. In its automotive section, the corporate expects tariff-related strain of round 1.25 proportion factors on revenue margin for 2025, with 1.5 factors already felt within the first half.
Spartanburg’s Benefits—And Limits
There’s a silver lining: Spartanburg operates inside a U.S. free-trade zone, which means components imported for autos destined for export would possibly evade these tariffs. The plant has even thought of including shifts to spice up output by as much as 80,000 models, partially to soak up coverage shocks.
In the meantime, BMW CEO Oliver Zipse stays publicly optimistic, pointing to the plant’s scale and export energy as potential leverage. Moreover, BMW is hopeful {that a} proposed EU-U.S. “netting mechanism”, which might permit exports from the U.S. to offset import tariffs based mostly on worth, might assist mitigate the harm.
BMW’s Spartanburg, South Carolina facility isn’t simply essential for BMW—it’s monumental. In 2024, it assembled 396,117 Sports activities Exercise Autos and Coupes, together with over 57,000 plug‑in hybrids (round 14 % of its quantity). Practically 225,000 autos had been exported, with the overall export worth exceeding $10 billion—making it the highest U.S. automotive exporter by worth. General, about 63 % of the plant’s manufacturing since 2014 has been exported.
Why This Hits Spartanburg More durable Than Earlier than
In prior tariff rounds, BMW weathered home metal and aluminum tariffs within the late 2010s. Nonetheless, the present wave is completely different as a result of it strikes automotive components themselves, not simply uncooked supplies. Meaning parts essential to each combustion and electrical powertrains—particularly EV-specific components like electrical metal—at the moment are costlier.
BMW’s $1.7 billion EV growth in Spartanburg (together with battery meeting) now faces a costlier actuality even earlier than EVs roll off the road. And with exports comprising the majority of plant output, any shift in export competitiveness is consequential.
Backside Line: Spartanburg has lengthy been BMW’s U.S. flagship—constructed for exports and progressively leaning into electrification. However Trump’s expanded tariffs now goal parts on the coronary heart of each its provide chains—not simply uncooked supplies. That layer of complexity and publicity comes at a vital juncture, simply as BMW seeks to scale EV manufacturing from its U.S. base.
BMW’s choices are clear: speed up U.S. localization of EV components (a multi-year effort), lean on free-trade exemptions for export-bound autos, and race for commerce lodging just like the EU-U.S. netting mechanism.
